The Competitive Advantage of Interconnected Firms-Industrial Dominance


Gaining a competitive advantage in business is one of the major critical success factors to achieve dominance in an industry. Without this one factor, a company or organization will never be able to establish itself as a major brand in the marketplace.

The interconnected firm’s factor is a powerful way of gaining a significant advantage over strong rivals and intriguing new entrants whose popularity is beginning to flourish. When firms become interconnecting the power to seize the industry becomes possible. To be interconnected is to be in multiple places.

One firm in one location is a recipe for disaster in today’s market place. To be highly successful a business must have operations in several places. The more locations, the more potential for remarkable success. Fortunately, advanced technology has made it possible for multiple firms to connect both nationally and international 24/7. Cloud computing, skype, teleconferences, and social networking are only a few ways for firms to constantly transact business.

Pros of interconnected firms

• Increased Capital
• Greater collaboration
• Greater skills, knowledge, and talents
• Enhanced communication
• Regional dominance
• Global expansion


• Regional or international limitations

The competitive advantage of interconnected firms is priceless. Without this advantage, the existence of great organizations may as well be an illusion. Interconnected firms possess more capital, knowledge, skills, and talents to work with than firms operating solo.

Creating alliances with other firms can provide access to ample financial resources, attractive technological expertise, a larger customer base and a broader range of customers wants, needs and demands.

Things Interconnected firms can do

Interconnected firms possess the capital to do several things, including providing superior service or products and going global. Its takes tremendous capital to open businesses overseas. Finding a location, marketing, training in a foreign land, buying equipment and distributing products requires tons of monetary resources.

Another advantage of interconnected firms is the ability to combine knowledge, skills, and talents for the sake of coming up with innovative ideas to improve product line and services. To excel in any industry, an organization must continue to grow and expand in every area of the organization.

The Bottom Line

Organizations that don’t expand or see no need to expand beyond a specific location will most likely not exist long in the marketplace. Great firms or companies that gain fortune 500 status, possess operations not only across America but also globally.

Interconnected firms have the power to handle the ups and downs of the marketplace and to come out on top of any industrial challenge.
Therefore, the unwillingness of a company to see the value of interconnectedness as a competitive advantage is an invitation to massive business failure.

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